Volkswagen lowers target owing to competition from Maruti and Hyundai

The economic slowdown which started in 2011 continues unabated to this date, making automakers rethink their expansion strategies in the Indian auto sector. One of the first automakers to scale down operations is Volkswagen India Pvt. Ltd, a company on the verge extensive expansion plans that has had to tone down strategies significantly.

Mahesh Kodumudi, Chief Representative,Volkswagen Group and MD of Volkswagen India Private Limited has confirmed these plans. The company was initially targeting 2 lakh units at the Chakan plant by 2017-18 from a current count of 1 lakh units which have now been reduced while the automakers market share in India has been scaled down to 7-8% by 2018 as against an earlier target of 20%. VW Group continues to contend with market leaders such as Maruti Suzuki and Hyundai where sales in India are concerned.

Out of the company’s five brands which include VW, Skoda, Audi, Porsche and Lamborghini it is only Audi that has emerged the strongest in India and able to maintain a strong position in the luxury market. In 2013, VW Group sales fell by 19% to 92,529 units as compared to sales in 2012 which stood at 1,14,045 units. Ever since then, VW volumes have been falling while for Skoda as well, volumes have witnessed a drastic dip in demand.

Volkswagen India has lined up new investments of about Rs 1,500 crores which will see the launch of new cars with increased localization content. This will be a big step in giving their consumers cars at a competitive pricing. Not only this will make VW cars more affordable, new investments will also improve after sales experience at dealerships.

A first drive in a manual rickety old van was enough to pave the road forward for Managing Editor, Sagar Patel. When not driving or riding, his dexterity shifts gear to voice passion through words via reviews, and news, all the while, closely monitoring updates from the auto industry.